Page 1 of 3

September 24, 2015

Submitted through the Federal eRulemaking Portal:

http://www.regulations.gov

Office of Regulations and Interpretations (Room N–5653)

Office of Exemption Determinations (Suite 400)

Employee Benefits Security Administration

U.S. Department of Labor

200 Constitution Avenue, N.W.

Washington, DC 20210

Attention: Conflict of Interest Rule and D–11712

RE: RIN 1210–AB32 (Conflict of Interest Rule)

Ladies and Gentlemen:

The ERISA Industry Committee (“ERIC”) is pleased to submit this supplemental response to the 

request of the U.S. Department of Labor (“DOL”) for comments regarding its proposed rule and 

proposed prohibited transaction exemptions and related amendments concerning conflicts of interest in 

retirement investment advice (collectively the regulation and the exemptions are referred to as the

“Conflict of Interest Rule”). The proposed Conflict of Interest Rule was published in the Federal 

Register on April 20, 2015.

ERIC is the only national trade association advocating solely for the employee benefit and 

compensation interests of the country’s largest employers. ERIC supports the ability of its large 

employer members to tailor health, retirement, and compensation benefits for millions of employees, 

retirees, and their families. ERIC’s members provide comprehensive retirement benefits to tens of 

millions of active and retired workers and their families.

ERIC believes that employees, retirees, and their families who wish to receive advice with respect to 

how to invest their retirement accounts or education to help them achieve their retirement savings 

goals should continue to have meaningful opportunities to do so. ERIC submitted a comment letter on 

July 21, 2015 outlining our recommendations on the Conflict of Interest Rule. As we indicated in our 

letter, ERIC appreciates that the DOL considered our prior comments and addressed, in the current 

proposal, many concerns of large employers that ERIC raised in its comments on the DOL’s earlier 

proposal. 

Specifically, ERIC appreciates the DOL’s position that non-individualized communications, such as in 

newsletters or generalized proxy statements, do not fall within the fiduciary definition. In addition, 

ERIC believes that the carve outs for “Counterparties to the Plan” (the “Seller’s Carve Out”), 

“Employees of the Plan Sponsor” (subject to certain clarifications), “Swap and Security Based Swap 

Transactions,” and “Financial Reports and Valuations” will be helpful to large plan sponsors and 

The ERISA Industry Committee

The Only National Association Advocating Solely for the Employee Benefit and Compensation Interests of America’s Largest Employers

1400 L Street, NW, Suite 350, Washington, DC 20005 • (202) 789 - 1400 • www.eric.org

Annette Guarisco Fildes, President & CEO
The ERISA Industry Committee September 24, 2015

Page 2 of 3

appropriately address large employer and plan activities that do not raise the conflict of interest 

concerns that are at the core of the Conflict of Interest Rule.

DOL Hearing: August 10 – August 13, 2015

As follow up to the DOL hearing on the Conflict of Interest Rule held August 10 – August 13, 2015, 

ERIC is submitting additional comments based on the statements made and discussions held over the 

course of the hearing including comments submitted for the record. We wish to highlight the 

discussions as applicable to our recommendations included in our July 21st letter as follows:

ERIC recommendation: The investment education carve-out should not prohibit references to 

specific plan investment options.

At the DOL hearing, there was much discussion concerning the proposed rules changes to the 

definition of education under Interpretive Bulletin 96-1. Under the current proposal, the education 

carve-out would prohibit references to specific plan investment options. ERIC has serious concerns if 

the DOL takes this approach in its final regulation. During the hearing, various witnesses discussed 

possible changes to the education carve-out. 

One approach was discussed specifically -- if the final rule allowed advisors (in the context of 

providing education to participants in a 401(k) plan) to reference specific plan investment IF the 

advisor referenced every investment option under each class of investments discussed under the 

auspices of the education conversation. ERIC would support this change to the regulation with two 

exceptions. First, we recommend that the DOL carve-out brokerage windows from this requirement. 

It would not be reasonable (or plausible) to expect investment advisors to reference every option 

available under a brokerage window alternative when discussing generally accepted investment 

principles and general investment strategy with a participant. Second, we recommend that if the DOL 

adopts this approach to the education carve-out, it also clarify that a target date fund is considered a 

single investment option (and not a loose association of the various funds under the target date fund 

umbrella investment product). 

ERIC recommendation: The regulation should make clear that discussions among co-workers should 

not constitute fiduciary investment advice.

ERIC’s comment letter included a recommendation that the final regulation should make it clear that 

comments of employees of the plan sponsor to their co-workers should not constitute fiduciary 

investment advice where the comments are not within the scope of the employees’ duties for the plan 

sponsor and the employees are not providing the comments in exchange for a fee or other 

compensation. ERIC’s comment letter provides detailed analysis regarding how the current draft of 

the proposed regulation could be interpreted to include these types of employee-to-employee 

discussions in the definition of fiduciary investment advice. During the DOL hearing, it was made 

clear that it was not the intent of the proposed regulation to cover these types of discussions. We 

strongly support changes to the final regulation that will clarify the point that such discussions among 

co-workers do not constitute fiduciary investment advice.
The ERISA Industry Committee September 24, 2015

Page 3 of 3

ERIC recommendation: The regulation should narrow the definition of the term “recommendation.”

ERIC’s comment letter stated that a mere “suggestion” should not constitute fiduciary investment 

advice, absent some “endorsement” or “encouragement.” Throughout the hearing, DOL 

representatives used the term “call to action” to further clarify what it meant by the term 

“recommendation” for purposes of the regulation. In our comment letter, we note that although the 

DOL appears to rely on the definition of recommendation under FINRA, the proposed regulation does 

not define the term “recommendation”. In fact, FINRA Rule 2111 does not define the term 

“recommendation.” By using the term “call to action” throughout the hearing as a substitute for the 

term “recommendation”, it is clear that the DOL is leaning towards a definition of the term 

“recommendation” that is more than a mere suggestion. We support a more narrowed definition of the 

term “recommendation” Including the use of the term “call to action.”

ERIC recommendation: Employers with limited involvement in a Health Savings Account (HSA) 

(as under current guidance) should not be deemed fiduciaries under the rule.

Existing DOL guidance provides that HSAs generally will not constitute ERISA employee welfare 

plans due to the “limited involvement” of the employer. To ensure consistency with this guidance, 

ERIC recommended in its comment letter that the final regulation state explicitly that employers do not 

become investment fiduciaries or co-fiduciaries as to an HSA by virtue of having “limited” 

involvement with the HSA within the meaning of the existing HSA guidance. At the hearing, 

representatives of the DOL stated that it was the intent of the proposed regulation to apply the current 

guidance to arrangements involving an HSA where the employer provides a vendor with a platform to 

invest HSA contributions and has limited involvement or no involvement with investment decisions 

made by the participant. ERIC supports this position and recommends that the DOL further clarify 

this position in the final regulation.

ERIC appreciates the opportunity to provide additional comments on the proposed regulations. If the 

DOL has any questions concerning our comments, or if we can be of further assistance, please contact 

us at (202) 789-1400.

Respectfully,

Annette Guarisco Fildes

President & CEO